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Why John McCain called this $13 billion aircraft carrier a “spectacular” debacle

October 2, 2015

By Christian Davenport

Thousands of people view the aircraft carrier USS Gerald R. Ford as it is christened at Newport News Shipbuilding in Virginia on November 9, 2013. (Joe Fudge/Newport News Daily Press)

Thousands of people view the aircraft carrier USS Gerald R. Ford as it is christened at Newport News Shipbuilding in Virginia on November 9, 2013. (Joe Fudge/Newport News Daily Press)
As the Gerald R. Ford-class aircraft carrier enters the annals of troubled acquisition programs—billions over budget, years behind schedule—it follows a familiar script, becoming yet another example of how the Pentagon struggles with buying major weapons systems.

The Navy’s program has become “one of the most spectacular acquisition debacles in recent memory. And that is saying something,” McCain (R-Ariz.) said during a Senate hearing on the troubled program Thursday.

But one thing stands out about the Ford-class carrier program that separates it from other flawed Pentagon acquisitions: the fact that Congress’ watchdog predicted many of the exact failures now plaguing the program almost a decade ago.

[$13 billion Navy carrier to be delivered late, incomplete and at higher cost]

The program is now $6 billion over budget, according to a review by McCain’s staff. And while the lead ship is expected to be delivered next year, the second ship in the fleet is five years behind schedule and won’t be ready until 2024.

In an attempt to contain the cost of the ships, built by Newport News-based Huntington Ingalls Industries, Congress imposed caps. But those were blown, and now the cost of the first ship is estimated to be nearly $13 billion.

“We simply cannot afford to pay $12.9 billion for a single ship,” said McCain, the chairman of the Armed Services Committee.

Like many other programs, the Ford-class carriers suffered from unrealistic cost estimates and overly optimistic timelines. And key Pentagon officials pushed the program forward even though key technologies hadn’t been fully tested, developed or designed, officials testified.

But there were warning signs. As early as 2007, before the Navy awarded the contract to build the ship, the GAO said that there “were key risks in the program that would impair the Navy’s ability to deliver [the first ship] at cost, on time and with its planned capabilities.” The program consists of three nuclear-powered ships designed to serve as successors to the Nimitz-class carriers.
The GAO even predicted in 2007 that the cost of the first ship was in danger of going 22 percent over budget. “Fast forward to today, 2015, cost increases are 22 percent,” said Paul Francis, the GAO’s managing director of Acquisition and Sourcing Management.

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But what is remarkable about the cost overruns and delays is how unremarkable they are, Franics said, citing a long line of troubled procurements, including the F-35 Joint Strike Fighter, the F-22 Raptor, the Littoral Combat Ship.

And now the Ford carriers should be added to that list, he said: “Same story different program.”

But this time, he said, “we knew all along this was going to be the case. We should not be surprised by anything that’s happened here. We saw it coming.”

In a statement, a spokeswoman for Huntington Ingalls said the Ford “is a first-in-class ship with the unique challenges associated with lead ships. We continue to work closely with the Navy to complete shipboard testing and apply lessons learned to further increase efficiencies.”

McCain took aim at Pentagon officials, particularly the office of Frank Kendall, the Undersecretary of Defense for Acquisition, Technology and Logistics.

“The Navy can be faulted for excessive optimism and deficient realism, but AT&L was either complacent or complicit,” he said.

The undersecretary’s office authorized the Navy to begin construction “when only 27 percent of the ship was designed and just five of its 13 new systems were mature,” McCain said. And it failed to heed the warnings from watchdogs and weapons testers.

Katharina McFarland, the Assistant Secretary of Defense for Acquisition agreed that the program had been beset with all sorts of problems that should have been avoided. She said that the goal is to “deliver successive ships within cost, providing capability and on schedule.” But she warned: “This will not be easy.”

Still, the Pentagon is “committed to applying the resources needed to keep control of aircraft carrier program costs and schedule,” she said.

Sean Stackley, Assistant Secretary of the Navy for Research, Development and Acquisition, said that trying to implement many new and untested technologies into the first new carrier design in 40 years led to many of the problems. But he said that, when completed, the Ford-class “will be the centerpiece of the carrier strike group of the future,” and that it has “an array of advanced technologies designed to improve warfighting capabilities and allow significant manpower reductions.”The hearing came as the House passed a Defense spending bill, which calls for significant reforms to the way the Pentagon acquires major weapons systems, including imposing fines on the services when there are cost overruns.

“We cannot afford another acquisition failure like the Ford-class aircraft acrrier, especially in the current fiscal environment,” McCain said.

Christian Davenport covers federal contracting for The Post’s Financial desk. He joined The Post in 2000 and has served as an editor on the Metro desk and as a reporter covering military affairs. He is the author of “As You Were: To War and Back with the Black Hawk Battalion of the Virginia National Guard.”